Financial Daily
from THE HINDU group of publications

Saturday, August 11, 2001



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Hectic activity in Balaji Tele, HCL Tech

Suresh Krishnamurthy

STOCK prices generally meandered down during the day, as trading activity remained cantered on a few pivotals. At the BSE, the Sensex closed down by a few points as the erosion in stock prices of HLL, Infosys and ITC more than offset the gain in stock pr ices of Reliance and Reliance Petroleum.

At the NSE though, the index gained marginally as the price gains since in addition to the gains of Reliance and Reliance Petroleum, gains in stock prices of non-Sensex stocks such as ABB, HDFC Bank and Hero Honda helped the index. The BSE Sensex closed at 3,316.21 while S&P CNX Nifty Junior closed at 1,071.15.

The CNX Nifty Junior declined by 0.47 per cent during the day. Despite positive price movements in stocks such as Bank of Baroda, Corporation Bank, Pfizer and Cadbury India, the sharp decline in stocks of Hughes Software and Sun Pharma pulled the index d own. The S&P 500 index also declined by 0.48 per cent to close at 691.35.

Trading volumes dipped marginally to Rs 776.11 crore from Rs 820.18 crore recorded on Thursday. The number of shares that advanced stood at 592 compared to the number of shares that declined at 726. However, advancing shares accounted for 60 per cent of the trading volumes. This is mainly a reflection of the hectic trading interest in gainers such as Balaji Telefilms and HCL Technologies.

In the counter of Balaji Telefilms, the dramatic surge in trading volumes continued unabated. The trading volumes of Balaji Telefilms in both the BSE and the NSE put together were in excess of Rs 1.44 crore shares.

Interestingly, the paid-up equity of the stock is only Rs 1.03 crore shares. Trading volumes are exceeding paid-up equity for the second consecutive day. While Balaji Telefilms declined on Thursday, stock price flared up on Friday.

The stock of HCL Technologies which had been on a sharp downtrend after the announcement of financial performance in the earlier part of the week, found buying interest during the day. Even as trading volumes remained robust and crossed the 30-lakh-share mark, the stock posted significant gains in value.

Other major gainers during the day included Reliance Petroleum, ICICI and Tata Engineering. The rise in the stock price of Tata Engineering comes in the backdrop of an improvement in sales of its commercial vehicles and its car Indica during July. The st ock of competitor, Ashok Leyland, however, lost value during the day.

The rise in stock price of Reliance Petroleum comes in the backdrop of the announcement on Thursday that the company may enhance capacity at its Jamnagar plant from 27 million tonnes to 50 million tonnes. In the case of ICICI, the stock price has risen i n spite of a downgrade of its ratings of foreign currency debt by S&P.

Major losers during the day included stocks from the media sector such as Mukta Arts, Padmalaya Telefilms, Tips Industries and Crest Communications. Trading volumes in these stocks were also quite robust. Other stocks to lose value include stocks such as Wipro, NIIT, ITC and Dabur India. The stocks of Indian healthcare majors -- Dr Reddy's and Cipla also logged significant losses. In contrast, the stock price of their compatriot Ranbaxy ruled relatively firm.

During the day, stocks such as Welspun India, Bayer ABS and Garden Silk Mills ruled at their 52-week highs. The firm trend in the stock price of Garden Silk Mills needs to be seen in the backdrop of an improvement in the financial performance of the comp any. In contrast, stocks such as Procter & Gamble, Glenmark Pharma, Dena Bank and Insilco descended to their 52 week lows. However, the stock of Procter & Gamble had recovered by close of trading to end with gains.

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